When being an “expert” is harmful

In a recent Capital Factory all-hands discussion, one of the founders started a question with a well-worn preamble:

“I talked to a bunch of the mentors and they all told me the same thing about pricing, but I’m telling you, they’re wrong. I know our industry, I know how our customers think, and in our industry …”

What followed was well-reasoned and sensible. Since none of the mentors have specific expertise in the industry in question, it was impossible to argue.

So rather than argue, I just asked:

“OK, so when you talked to the last dozen potential customers and proposed the pricing scheme you just described, you’re telling me they all said, ‘Heck yes’?”

“Well, I didn’t actually ask them, no.”

“Why not?”

“Because I know what they’re going to say.”

“Great! So, next week you’re going to a convention where you’ll talk to dozens of new potential customers. Do me a favor — humor me! — and include your pricing scheme in the pitch. I’m sure you’re right and they’ll be thrilled, but since you’re so sure it certainly won’t hurt to include it. In fact, it will strengthen your pitch because it will match their expectations and therefore mitigate any worry that you don’t ‘get it.’”

“OK, I will!”

I could already see the self-satisfaction on her face. She knew she’d have a great “I told you so” moment next week, and in fact I was equally sure she’d have that moment! She is the expert, I’m not. Case closed.

Of course (you know what’s coming), it turns out she was wrong. And whenever an assumption is kicked out from under you, that’s when you learn the most.

The following week she sent me this email (my emphasis):

Ever since accidentally stumbling upon lean startup 1+ years ago, I’ve struggled to implement the principles correctly. Somehow my version of “lean” customer discovery involved hour long phone calls, relationship-building networking meetings, vague answers to improperly formulated questions…

In the past week of quick phone calls to vendors, I’ve learned more about this market than I did in the past year. I also got a good feel for when I no longer needed to do further discovery.

We’re all plagued by this defect of human nature — thinking we know more than we do — which then causes us to miss opportunities to actually learn something. I still struggle — in every customer call I have to consciously restrain myself from pitching and instead ask questions, and really try to understand what they mean instead of mapping their words onto what I want them to say.

The worst is when you’re an “expert” because then you’re even less likely to challenge your assumptions.

As an “expert” you’ve devised your own laws about what makes your market different from other markets, and what makes your company unique. Even with prior experience, this knowledge based largely on feeling, not fact.

When I say this to “experts,” their first reaction is (of course) defensive. “But I have 15 years of experience selling into the financial services sector; I know what makes them tick.” Shoot, I used this excuse myself recently: “I built a company and forged dozens of customer relationships in the software development tools sector; I know exactly how to sell into that market.”

This is wrong for a number of reasons.

First, markets change rapidly. You can’t rely on five-year-old information about your potential customers — even the stodgy big-company ones but especially the mass-market consumer ones.

Non-technical people now employ technology (iPhones, Facebook). Industries built around control of information are now out of control (real estate, publishing). Methods of reaching consumers change every year (compare SEO or AdWords strategies from 2003 and 2010). Expectations of what software should do, or what it should integrate with, or whether it’s OK for data to live on your laptop or someone else’s server, or whether it needs to be accessible from a cellphone — it’s all changing, all the time.

Ironically your 10-15 years of experience “in the field” might be clouding your judgement. Some of that experience is invaluable — so much so that it’s an unfair advantage. But your outmoded ideas prevent you from addressing the market as it is today, allowing a competitor to beat you with innovative advances they achieve exactly because they’re not shackled by old ideas.

Another way your experience can hamper you is that selling different products into the same industry is different.

For example, I talked to an entrepreneur with years of experience selling a standard medical device to doctors. He has an idea for a new software package for managing an expensive, time-consuming aspect of practice-management. Of course his rolodex gives him an lovely advantage — he can bounce ideas off potential customers and line up ten alpha testers before writing a line of code.

But he hadn’t done that. He told me that he’s been selling to doctors for years. I asked whether it was OK to install new software on their computer; he didn’t know because he was selling hardware before. I asked whether it was OK to depend on an Internet connection inside a secured hospital; he said “probably” but he’d never asked. I wondered what they would pay for this software; he said they paid a lot for this medical device so it should be easy to get lots of money for this software. I doubted that the budget for front-office software has any relation to that for devices; he hadn’t thought of that. I asked how many people had agreed they actually wanted this particular software, even for free, and he said zero, so far. But that didn’t worry him.

Your knowledge of one slice of a market doesn’t automatically set you up for other slices. You’re not starting from scratch, but you have to have an attitude of re-learning.

Of course if you can fuse your special knowledge with an open mind, that could very well be an unbeatable combination.

But you have to set your ego aside and actively force yourself to explore anew with a “child-like” mind. Use that rolodex to set up meetings and sales calls, but don’t assume you know what they’re going to say. Use that experience to come up with plausible theories, not to make decisions.

It won’t happen unless you force yourself to do it.

Keep it going in the comments: What aspects of being an “expert” gives you an advantage and which hold you back? Do you have stories of root assumptions turning out wrong?